Financial Sector Development and the Millennium Development Goals

World Bank Working Paper No. 89

16 Pages Posted: 22 Feb 2007

See all articles by Stijn Claessens

Stijn Claessens

Bank for International Settlements (BIS)

Erik Feyen

World Bank - Finance & Markets Global Practice; Ahead Analytics Inc

Date Written: January 2007

Abstract

This book can be purchased at the World Bank website.

This study investigates the relationship between financial sector development and progress in reaching the Millennium Development Goals (MDGs).

We assess the contribution of countries' financial sector development to achieving the MDGs. We focus on the relationships between financial development and economic welfare and growth, and the following four MDG themes: Poverty, Education, Health, and Gender Equality. In doing so, we review the theoretical channels, survey existing empirical evidence - both cross-country and case study evidence - and provide new evidence.

We find that financial development is an important driver for economic welfare in that it reduces the prevalence of income poverty and undernourishment. In addition, we provide new evidence of a positive association between financial development and health, education, and gender equality.

Keywords: Millennium Development Goals, Financial Sector Development, Poverty, Growth: Access to Finance

JEL Classification: O11, O16, G00

Suggested Citation

Claessens, Stijn and Feyen, Erik H. B., Financial Sector Development and the Millennium Development Goals (January 2007). World Bank Working Paper No. 89. Available at SSRN: https://ssrn.com/abstract=950269 or http://dx.doi.org/10.2139/ssrn.950269

Stijn Claessens

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
CH-4002 Basel
Switzerland

Erik H. B. Feyen (Contact Author)

World Bank - Finance & Markets Global Practice ( email )

1818 H Street, N.W.
Washington, DC 20433
United States
+1 (202) 458 2038 (Phone)
+1 (202) 522 3184 (Fax)

Ahead Analytics Inc ( email )

Washington, DC
United States

HOME PAGE: http://www.aheadanalytics.com

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